Sorry, there are no results matching your search.
Autocomplete suggestions are available. Use up and down arrows to review and enter to select.
Sorry, there are no results matching your search.
Autocomplete suggestions are available. Use up and down arrows to review and enter to select.

Credit Markets Update Q4 2024

Read more about the credit markets activity during Q4 2024

Credit Markets Update Q4 2024

Download PDF
Download PDF
Share

Credit Markets Commentary

After a strong finish to 2024, expectations are high for a big 2025

  • The final quarter of 2024 continued the second half theme of rapidly rebounding institutional markets.
  • With volumes and activity at or near record-breaking levels and/or multi-year highs by the end of 2024, the markets are wide open across the board as compared to 12-18 months ago.
  • Activity has mostly been driven by repricings and maturity extensions, but there was an uptick in M&A-related financings that hopefully is an early indicator for a strong M&A environment in 2025.
  • Many deals have seen oversubscription and tightening spreads with spread compression particularly evident across the spectrum of BB / B ratings.
  • Record setting CLO issuance is continuing to fuel liquidity in the market; private credit cash returns have outpaced private equity, which has resulted in substantial cash flows into private credit.
  • The environment in the private middle market could be characterized as a robust, issuer-friendly market in search of issuers.
  • Many of the key dynamics of high investor demand, tightening spreads, and loosening of covenants have also been seen in the private middle market, but the challenge has been that the supply of deals is well below the demand by investors, particularly for M&A-related financings.
  • Adding all those factors together, the credit markets are primed and ready for a big 2025.

Tailwinds for 2025 appear strong…

  • Anticipated pro-growth / pro-business policies from the new administration
  • While too early to declare complete victory, the Fed seems to have a handle on inflation and rate cuts should continue
  • Maturity walls and aging portfolio investments should spur overdue recap and M&A activity from financial sponsors

…but danger is always lurking on the horizon

  • The Fed may slow the pace of rate cuts from the anticipated plan in early 2024, but a halt to cutting all together if inflation unexpectedly surges could send shock waves through the markets
  • The biggest wild card in 2025 seems to be geopolitical risk – any expansion of wars or surprise conflicts that disrupt trade could quickly unravel the momentum building for a strong 2025

Download the document:

Credit Markets Update Q4 2024

Read more about the credit markets activity during Q4 2024

Download PDF

Meet our team

In today’s market, you need an advisor with objective insight at every step of the transaction process. We work with you throughout the full deal cycle to create value and successfully execute your deal strategy.

Image of Howard P Lanser
Howard P Lanser
Managing Director, KPMG Corporate Finance LLC
Read bio
Image of Howard P Lanser
Howard P Lanser
Managing Director, KPMG Corporate Finance LLC
Read bio

Corporate finance services, including Financing, Debt Advisory, and Valuation Services, are not performed by all KPMG member firms and are not offered by member firms in certain jurisdictions due to legal or regulatory constraints. The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act upon such information without appropriate professional advice after a thorough examination of the particular situation. 

The information contained in this communication may not be representative of the experience of other clients and does not constitute a recommendation, offer, or solicitation to buy, sell or hold any security of any issuer. Past performance does not guarantee future results.

©2025 KPMG Corporate Finance LLC, a Delaware limited liability company. Member FINRA/SIPC. KPMG Corporate Finance LLC is a subsidiary of KPMG LLP, a Delaware limited liability partnership and a member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. KPMG Corporate Finance LLC is not engaged in the practice of public accountancy. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International.

Thank you!

Thank you for contacting KPMG. We will respond to you as soon as possible.

Contact KPMG

Use this form to submit general inquiries to KPMG. We will respond to you as soon as possible.

By submitting, you agree that KPMG LLP may process any personal information you provide pursuant to KPMG LLP's Privacy Statement.

An error occurred. Please contact customer support.

Job seekers

Visit our careers section or search our jobs database.

Search now!

Submit RFP

Use the RFP submission form to detail the services KPMG can help assist you with.

Submit

Office locations

View locations

International hotline

You can confidentially report concerns to the KPMG International hotline

Learn more

Press contacts

Do you need to speak with our Press Office? Here's how to get in touch.

Contact

Headline